Charles & Colvard, Ltd., has announced that the Company’s Board of Directors has approved a one-for-ten (1:10) reverse split of the Company’s common stock, no par value per share (the “Reverse Stock Split”), to be effective as of 12:01 a.m. Eastern Time on May 17, 2024 (the “Effective Date”). The Reverse Stock Split is intended to bring the Company into compliance with Nasdaq’s $1.00 per share minimum bid price requirement for continued listing.
The Company expects its common stock to begin trading on a split-adjusted basis on the Nasdaq Capital Market as of the commencement of trading on May 17, 2024 with a new CUSIP number of 159765205. The ticker symbol for the Company stock will remain “CTHR.”
At a special meeting held on May 7, 2024, The Company’s shareholders approved a proposal to amend the Company’s Restated Articles of Incorporation to effect a Reverse Stock Split at a ratio within a range from any whole number between one-for-ten to one-for-fifteen, as determined by the Board of Directors in its sole discretion. The Company filed the Articles of Amendment to its Restated Articles of Incorporation with the North Carolina Secretary of State on May 14, 2024.
Information for Shareholders
The Reverse Stock Split will, as of the effective date, reduce the number of the issued and outstanding shares of the Company’s common stock from approximately 30,344,955 to approximately 3,034,496. The total authorized number of shares of common stock will remain the same. No fractional shares will be issued in connection with the Reverse Stock Split, and fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole share. The Company’s common stock will continue to have no par value per share. No further action on the part of shareholders will be required to implement the Reverse Stock Split.
The Company’s transfer agent, Equiniti Trust Company, LLC, will act as its exchange agent for the Reverse Stock Split. Equiniti will provide instructions to any shareholders with physical stock certificates regarding the process for exchanging their certificates for split-adjusted shares into “book-entry form.” Shares held by shareholders in “street name” will have their accounts automatically credited by their brokerage firm, bank or other nominee, as will any shareholders who held their shares in book-entry form at Equiniti. Equiniti can be reached at (877) 248-6417 or (718) 921-8317.
Impact on Equity Incentives
Proportionate adjustments will be made to the per-share exercise price, grant price, purchase price and/or the number of shares subject to all then outstanding stock options, restricted stock units and other awards issued under the Company’s 2008 Stock Incentive Plan and 2018 Equity Incentive Plan (each, a “Plan” and, collectively, the “Plans”), which will result in a proportional decrease in the number of shares of the Company’s common stock reserved for issuance upon exercise of such Equity Awards. The number of shares then reserved for issuance under the Plans will be reduced proportionately based upon the Reverse Stock Split. All share and per share amounts in the Company’s financial statements and the notes thereto will be retroactively adjusted for all periods to give effect to the Reverse Stock Split.
